Travis Smith: my resume, bio and photos back to the main blog page

Charging for content: Syndication and other models

Case Study of the Subscription Model at Variety.com

[I gave this talk at the Highway Africa 2001 conference in Grahamstown, South Africa, in September 2001.  I was one of two speakers, the other person talked about syndication, which, as an aside, I think is very difficult to do simultaneously with requiring subscriptions….]

Variety was among the first of a group of newspapers that have recently switched to a full subscription model.  In addition, since the day Variety.com launched in 1998, it had a partial subscription model—it charged for some of its articles.  Is Variety’s model an example for the rest of the industry? Maybe not—there’s a number of a differences between this trade publication and a general interest newspaper.

SUMMARY
* ABOUT ME
* ABOUT VARIETY
* THE SUBSCRIPTION MODEL
* SUCCESS?
* FUTURE PLANS?

About Me
* First used a BBS in 1981 to dial into pirate bulletin boards
* First used email and chat in 1990 to keep in touch with my girlfriend in Canada
* When told of it, my Dad said “someone’s paying for it”—and he was right
* Went to work for the Los Angeles Times with Prodigy and then with a Web site
* Left there as Deputy Editorial Director
* Left to move to Paris, did consulting, learned photography and French
* Moved to Budapest to work for Pressflex as Vice President of Client Relations
* Pressflex offered a Web publishing system to small publishers lacking staff and skills to develop their own Web presence
* Moved back to Los Angeles become editor of the Variety Web site

About Variety
* Based in Los Angeles and New York, stringers in dozens of countries
* Covers the business of entertainment (not celebrity gossip)
* Established in 1905, covering vaudeville
* Started covering movies, radio, television, rock and roll, the VCR, the CD,
* Daily Gotham edition as well, launched in 1998

Print info
* Daily Variety has a print circulation of 65,000 (unduplicated for all publications
* Cost: Daily: $239 annual, U.S.
* Weekly: $219 - $485

About Variety.com
* Launched in 1998
* Always had paid content
* Offers news, reviews, box office numbers,
  entertainment calendar, stock info, event photos,
  production charts
* Archives back to 1998, some reviews back to 1914

Original plan (1998)
* Mostly ads, some subscription
* Some content free, some paid
* no Weekly articles
* Cost for print subs: $180 / year
* Cost for online only: $396 / year
  or $6 / day
* Three sales people for online only

Current plan (2001)
* Even split between subscription and ads
* Nothing free on site (except classifieds, help, and email sign up)
* Cost for current print subscribers: free
* Cost for online only: $59 / year
  or $2.95 / day (same as print)
* integrated sales staff with one trainer
* all articles, reviews online

What else?
* 9 more email newsletters
  offered for free
* Started marketing the site
* Included clickable bylines
* Redesigned the site to improve usability

What’s happened?
* Before (end of 2000, Q1 2001):
  130,000 uniques / month
  2 million page views / month
* After (Q3 2001):
  225,000 uniques per month
  2.2 million page views and growing

* Before: 1,500 subscribers
  50% also print subs / 50% online only
* After: 12,000 subscribers
  75% active print / 25% online
 
* Before: 24,000 email subscribers
  120,000 emails a week
* After: 100,000 subscribers
  255,000 emails a week
  (Note: we added 8 more email publications)

Ad revenue
* Is up over last year
* Is 75% of our total revenue

Benefits of Full Subscription
* Clear message to readers: “All our content has value”
* Closer ties to the newsroom (they pay attention to something worth paying for, to something with paying customers)
* Helps to clarify and distill your audience
* Allows you to offer better service to your customers (you can identify and personalize more easily)
* Is easier to maintain and produce for than a split-tiered site (of course, all free is easiest)

What Can You Charge For?
* Original content
* Credible content (not random user discussion, but possibly insiders/expert)
* Valuable content (that which is used to make financial decisions)
* Timely content (that which you have first, or which you can deliver to the reader in an efficient and unique presentation)
* Your brand, your history and the trust you have built up with existing clients—they will pay if you ask them to

Other Notes
* Requires online order taking and customer service
* Requires an integrated print and online database (which you MUST have anyway to offer reasonable customer service)
* Requires unique content—if they can get it (easily) elsewhere, they will
* Requires some, but not much, protection against people sharing a password around - it’ll happen, just make it more annoying to do
* Requires much more security against granting access to people’s personal data

Future?
* Watching wireless
* Personalization in small steps, where appropriate
* Possible syndication of Variety data content (not articles, other data collections)
* Building out classifieds (it’s never been a Variety focus)
* Possible press release service
* Acting as a Web publisher—sharing resources and building services for our advertisers, much as the print paper builds ads for certain advertisers, completely separate from editorial



 
 

 

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The Conference in Grahamstown

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It was like a dream…

Overheard

“The sad truth is that most evil is done by people who never make up their minds to be good or evil.”

...who said it?

“Almost every American I know does trade large portions of his life for entertainment, hour by weeknight hour, binge by Saturday binge, Facebook check by Facebook check. I’m one of them. In the course of writing this I’ve watched all 13 episodes of House of Cards and who knows how many more West Wing episodes, and I’ve spent any number of blurred hours falling down internet rabbit holes. All instead of reading, or writing, or working, or spending real time with people I love.”

...who said it?

“Live a good life. If there are gods and they are just, then they will not care how devout you have been, but will welcome you based on the virtues you have lived by. If there are gods, but unjust, then you should not want to worship them. If there are no gods, then you will be gone, but will have lived a noble life that will live on in the memories of your loved ones.”

...who said it?

“I play with variables constantly.”

...who said it?

“Only the person who has learned Continual Love coming from a heart of Gratitude/Worship can effectively deal with the problem of loneliness.”

...who said it?

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